upGrad acquires Unacademy for just over $200 million: ‘Sold for fraction of peak valuation’

Edtech major upGrad has completed the acquisition of rival Unacademy in a 100% share-swap transaction valued at just over $200 million, Unacademy co-founder and CEO Gaurav Munjal said on Tuesday.

Ronnie Screwvala, co-founder and chairman of upGrad, said the combination could create "incredible synergies" across the learning ecosystem.

"We're happy to close the acquisition and coming together of Unacademy and upGrad," Screwvala said in a post on X.

Recalling his first meeting with Munjal in 2020, Screwvala said the Unacademy founder had approached him and Mayank Kumar, co-founder and managing director of upGrad, with a proposal for the two companies to come together.

"What stood out was Gaurav's incredible level of self-confidence, but at the same time, the respect he had for what he had built and what upGrad had built," Screwvala said.

Munjal, in his post, acknowledged that Unacademy had raised funds at a peak valuation but was being acquired at a fraction of that value.

"Six years ago today, Unacademy became a unicorn. Today, Unacademy has closed its acquisition by UpGrad for just over $200M. We raised at a peak, but sold at a fraction of that," he said.

"I'm not going to dress these facts up. But I am proud of what this team did between those two numbers," he added.

Unacademy was valued at nearly $3.4 billion at its peak in 2021, while Munjal had said in December last year that the company's valuation had fallen below $500 million.

Munjal said Unacademy had a topline of around ₹400 crore, most of its businesses were profitable or near-profitable and it had about ₹900 crore in the bank, giving it the option to continue independently.

"Nobody was forcing this. But sometimes, you are drawn towards a path that is more exciting than the one that makes you more money," he said.

He said the decision to combine with upGrad was driven by the belief that it was a better path for the broader education ecosystem.

The acquisition comes months after the two companies initially failed to reach an agreement.

At the time, Munjal had said the valuation would not be disclosed until the transaction closed and the relevant papers were filed.

Munjal will continue as co-founder and CEO of Unacademy and focus on building online education products for learners in India and globally.

Screwvala said Unacademy brings strengths in product and technology, a different target audience, brand value and resilience to the combined entity.

"I think there are going to be some incredible synergies and some incredibly diabolically different, but very radically fresh and innovative thoughts brought to the table," he said.

Unacademy was founded as a YouTube channel in 2010 and formally launched as an online learning platform in 2015.

It expanded rapidly during the COVID-19 pandemic as demand for online education surged, but later faced challenges as students returned to physical classrooms and competition intensified.

Munjal said Unacademy's free platform helped create a generation of celebrity educators, whose YouTube videos collectively crossed 10 billion views.

He also pointed to Airlearn, Unacademy's language-learning product, which he said became one of the world's top three most-downloaded language-learning apps in less than two years.

"We always wanted to build a global consumer product out of India. We did," Munjal said.

Screwvala also said he was excited about Airlearn and its potential to demonstrate how products built in India can find global markets.